perspective importance of ipr
TRANSCRIPT
8/6/2019 Perspective Importance of IPR
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Subramaniam Vutha scripts an interesting role-play between a senior
business executive and an intellectual property rights practitioner to emphasise
the need for better understanding of intellectual property rights
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egardless of the role played by a manager,
chances are that knowledge of intellectual
property rights (IPR) could help him or herperform better by gaining competitive advantage,
mitigating risks and opening up new business options.
Here is a hypothetical conversation between a
senior business executive and an IPR practitioner that
will indicate how this happens. The conversation begins
with a statement by the IP practitioner that IPR is the
second most important bit of knowledge for a manager.
Senior business executive (SBE): That was an
interesting presentation on intellectual property
management. But why did you say IPR is the second
most important thing a manager should know? I am
not sure I understand why intellectual property rightsare important for a manager like me.
IP practitioner (IPP): While a manager needs to know
about his managerial functions, he also needs to
understand how such managerial functions generate IP
assets. In addition, he should know how he could help
protect and leverage such IP assets in work situations.
SBE: It is still very fuzzy to me. Can you please explain
how IPR is relevant to managerial functions?
IPP: When a business executive engages in various
managerial functions, he generally does [perhaps,
without being aware of it] one or more of the following
for his company:
Generates IP assets.
Uses or leverages IP assets.
Trades or exchanges IP assets.
Cedes or diminishes the value of certain IP assets.
SBE: Perhaps you can give me some examples to make
things clearer.
IPP: Sure. Take any managerial function that you have
engaged in over the past few years.
SBE: Well, among other things, I help develop strategic
business plans for my company.
IPP: What happens if your business plan is madeavailable to your competitors?
SBE: That would be disastrous. We won’t let that
happen.
IPP: Why?
SBE: You know why! We work on our strategic business
plans for months. The plans are the outcome of our
efforts, judgment, experience and our knowledge of
markets and of competitors. If these leak to our
competitors it would be terrible for us, and an
advantage for our competitors.
IPP: You have just defined what a trade secret [a formof IPR] means. Trade secrets have economic value
because of the skill, judgment, money and effort used to
generate, compile or acquire them. Trade secrets are
often key IP assets. In fact it is estimated that about 80
per cent of the value of technology transfers and
licencing deals springs from the trade secret component
of the technology transferred or licensed.
SBE: Please give me some more examples. For example,
what happens if we develop a new or improved process,
technique or methodology?
IPP: The new or improved process, technique or
methodology would be a valuable trade secret of your
company and would thus form part of your IP
portfolio. Such processes or techniques could even have
patented features.
SBE: Which means we probably already have a sizeable
IP portfolio, without realising it!
IPP: Yes, of course, I am sure you do. The formal
inventorying of a company’s IP assets generally yields
surprising results. The outcome is usually an eye-opener
The importance of IPR knowledge
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to people in the organisation who often underestimate
the value of their own output.
SBE: I see. How about the supply chain and the
distribution network? How is IPR relevant to the
development or improvement of these?
IPP: Details of your supply chain, your vendor profiles
and their capabilities, their prices and their
specialisations are of considerable value to you.
Similarly, details of your distribution network, names,
addresses, capabilities, locations and the like are also
vital bits of information for your business. These are
your key trade secrets. Customer relationship
management data is also a valuable trade secret. These
can be of considerable value to your current and
emerging competitors. So you should guard these as
valuable trade secrets of your company.
SBE: I understand. But coming back to my originalpoint, once a business executive has finished developing
or generating some of these IP assets, what further role
does he play? Should not the lawyers take charge of
such IP assets?
IPP: Lawyers help us protect and license our IP assets.
But those who generate IP assets, control IP assets and
leverage IP assets should play a major role in IP plans
and strategies. That is the role of people like you. How
else will you manage IPR for business advantage?
SBE: So your point is that it is not the lawyer who
generates IPR, it is people like me.
IPP: Precisely. Researchers invent. Developers createsoftware. Technologists develop techniques,
methodologies, know-how and inventions. Most
managers create and improve processes. Sales and
marketing people generate customer and market data,
and market studies. Safety engineers create new safety
methods and apparatus. Architects and designers create
new designs, drawings and blueprints. Purchase and
supply-chain managers generate vendor and sourcing
information. Accountants and finance persons create cost
data, pricing policies and pricing data. Quality people
generate quality tests, processes and methodologies. All
such work output results in some form of IPR.
SBE: And who controls and leverages such IPR?
IPP: Generally, the persons who generate the IPR, or
their colleagues, control and leverage such IPR. For
example, inventions, techniques, processes, data, studies,
reports and the like are valuable in business because
they provide some form of competitive advantage or
business benefit. The lawyer does play a role in
protecting IPR — usually through patent or copyright
filings or through secrecy contracts and so on. But it is
the business managers who generate, control and
leverage this IPR.
SBE: But where is the IPR in their work output? That is
not yet clear to me.
IPP: Inventions can be patented. So can some
innovative processes. Methodologies, techniques,
business and operational information, formulae, tools,
designs, drawings and blueprints can be protected as
trade secrets. And any idea expressed and fixed in any
media is copyright material, including software.
SBE: It looks like business executives like me need to
know a lot more about IPR than we do now, and need
to work with our lawyers to protect and leverage our IP
assets. How do you suggest we go about creating IP
awareness in our company?
IPP: Your company could adopt a holistic 360°
approach to creating IP awareness and train people who
will engage in IP asset management; use IP assets to
reduce risks, increase profits and open up new business
options and help sustain gains from technology
improvements and innovations. Business managers like
you should learn how to use IP assets to reduce risks,
increase profits and open up new business options.
SBE: Thank you, this has been a useful conversation.
We will get to work on our IPR plans right away.
Subramaniam Vutha is a consultant with the Tatas on
the Group IPM programme, and an advocate with the
firm of Subramaniam Vutha and Associates. He
specialises in complex IT transactions and in the
management of intellectual property rights and assets.
81Tata Review September 2010
“ “While a manager needs to know about
his managerial functions, he also needs
to understand how such managerial
functions generate IP assets
Subramaniam Vutha